Financial-condition grades for SEC filers
Every eligible filer is placed in one of five bands by total assets, with cut points fixed on the 2012 to 2019 training window. The failure model is fit and tested within each band, and the band sets the peer failure rate shown on a company page. Within a sector the letter tracks size, and this page shows by how much.
Share of each letter among the graded companies of each band, smallest assets at the top.
| Band, total assets | Eligible | Graded | Median inputs of 14 | A | B | C | D | E |
|---|---|---|---|---|---|---|---|---|
| under $12.5M assets | 263 | 53 | 5 | 0% | 2% | 9% | 17% | 72% |
| $12.5M to $120M assets | 634 | 293 | 6.0 | 15% | 16% | 15% | 19% | 35% |
| $120M to $591M assets | 651 | 361 | 7 | 24% | 17% | 21% | 19% | 19% |
| $591M to $2.67B assets | 737 | 568 | 8 | 27% | 25% | 16% | 20% | 12% |
| over $2.67B assets | 1,155 | 929 | 9 | 21% | 20% | 23% | 22% | 13% |
| unassigned | 105 | 0 | 0 |
Out-of-sample AUC of the failure model within each band, with its 95% interval; filings 2020 to 2025.
| Size band, total assets | AUC | 95% interval | Test events | Failure rate a year |
|---|---|---|---|---|
| under $12.5M assets | 0.760 | 0.648 to 0.863 | 63 | 0.60% |
| $12.5M to $120M assets | 0.827 | 0.787 to 0.862 | 201 | 1.07% |
| $120M to $591M assets | 0.866 | 0.831 to 0.897 | 206 | 1.03% |
| $591M to $2.67B assets | 0.912 | 0.876 to 0.942 | 160 | 1.01% |
| over $2.67B assets | 0.936 | 0.882 to 0.967 | 61 | 0.52% |
| All filers | 0.877 | 0.858 to 0.895 | 691 |
Standard universe: revenue above $1M and total assets above $10M; the screen every published distress figure was measured inside. Inside: AUC 0.889, 617 events. Outside: AUC 0.745, 74 events. Failure rates are the annualized 12-month Item 1.03 frequency, filings 2012-01-01 to 2025-12-31.
revenue above $1M and total assets above $10M; the screen every published distress figure was measured inside. Today 2,835 eligible filers are inside and 323 outside. Membership is reported on every company page and never required for a letter.